The company i work for was recently bought out; as a result employees are being forced to sell company stock. Some of my ESPP shares are disqualified/Long Term Capital gains and some are disqualified/Short term Capital Gains.

Because this is a forced sale am i still required to pay and report taxes as if i had voluntarily sold them or is there an exception?

is there a way to avoid this..(e.g. roll them into a 401(k)).

1 Answer 1


No, there's no way to avoid this. You sold the stocks, and there's an explicit exclusion in Sec. 1031 for securities, so you cannot defer taxes by exchanging. You will have to recognize the gain and pay the taxes.

You cannot roll over non-retirement funds to 401(k), you can only contribute. So that is not an option either.

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